By: H. Sterling Burnett, the Heartland Institute
In a much-anticipated decision, President Donald Trump kept his campaign promise by announcing recently that the United States will withdraw from the Paris climate agreement negotiated by 195 countries in December 2015. Under the agreement, the United States is required to cut its carbon-dioxide emissions 28 percent below 2005 levels by 2025, and to provide billions of dollars in funding to the Green Climate Fund, which is administered by the United Nations.
The emission cuts required by the Paris agreement would have forced the closure of many of the least-expensive power plants nationwide over the next decade, raising energy prices at a time of tepid economic growth and sky-high deficits. The low energy prices created by America’s low-cost, abundant coal, oil and natural gas and the growth of those and related industries was responsible for almost all the economic growth that occurred during the Obama years.
A study by NERA Economic Consulting cited by Trump in his announcement of the Paris pull-out estimated if the United States were to meet its carbon-dioxide emissions reduction obligations under the Paris climate agreement, it would cost the economy nearly $3 trillion, with the United States losing 6.5 million industrial jobs by 2040, including 3.1 million in the manufacturing sector.
Trump’s withdrawal is good news for the auto industry and the communities dependent on it, as they would have likely been hit the hardest by the Paris agreement’s mandates. Withdrawing from the Paris accord allows Trump to revise the motor-fuel efficiency standards imposed by the Obama administration that ratcheted up fuel-economy standards to levels that soon would make most U.S. automobiles — and most cars from around the world — either unaffordable or would force Americans to drive only the smallest of subcompact cars.
The powerful sedans, sports cars and SUVs produced in Detroit would be unable to meet the 54-mile-per-gallon standard imposed by Obama and would eventually become extinct, leaving consumers with less freedom to choose the vehicle that best fits their needs. Obama’s costly federal fuel-economy standards shoehorn everyone into underpowered, small, less-safe vehicles.